Outline, Pages 3 (623 words)
There is no single method for timing market entry into any type of business, whether it is e-business or traditional business. Timing is more important in e-business since technologies change fast. Even a few weeks’ delay can cost the company dearly. The method used for timing market entry depends on factors such as the type of product, the particular market, the amount of competition and the budget available. The method used may also involve a single strategy or a mixture of different strategies.
A successful product launch or market entry depends also on good timing and takes the characteristics of the target groups into account. In the case of timing as a strategic dimension, three basic possibilities can be differentiated: ●Be the first to launch as a ‘first mover’;
●Launch in parallel;
●Launch with delay
In an article published by Wright State University, Gurumurthy Kalyanaram, Director of Master’s Programs in the School of Management at the University of Texas, Dallas and Ragu Gurumurthy, principal at consulting firm Booz-Allen and Hamilton, suggest that the best general entry timing strategy is to be first into the market.
Although expensive, they point out that this approach has been shown to give the product a significant advantage in market share. They suggest this strategy works best in industries where product life is short, such as the high-tech industry. Late Arrival
Kalyanaram and Gurumurthy point out that entering a market late can have certain advantages as well, particularly if the pioneers have grown complacent or can no longer cater to a growing market, and also, if the late arrival has an innovative way to market their product.
Late entry may also pay off if the product offers technological improvement over those already available, is significantly cheaper or offers better customer service. Markets that are already cluttered with products offer some opportunity for a late arrival that is of better quality or uses new delivery channels. Dynamic Timing
A new method for timing market entry was suggested by Sechan Oh and Ozalp Ozer, from the University of Texas at Dallas School of Management, in a paper delivered to the 2010 Manufacturing and Service Operations Management Conference. Oh and Ozer suggest that, as a business goes through the design process for a new product, they should constantly update their own knowledge about both the efficiency of the production process and the potential market. The product should continue to be improved until the optimal time to enter the market. At that point, the design process should stop and the product should enter the market. Time of Year
The time of year can have a big effect on chances of success. Some industries are busier at certain times of the year. For example, accountants are not likely to take up new tax software in the run-up to April 15th, as they won’t have time to learn how to use it while they are busy. Similarly, a product designed for sale at Christmas should be released early enough in the year to gain momentum by the time the peak shopping season arrives. Wave, Sprinkler, Waterfall
These types of timing strategy, developed by management consultant Christoph Lymbersky, are usually applied to timing entry to international markets. In the wave strategy, a new product is introduced all at once into countries that have similar cultures and characteristics. For example, a product like smartphone or Tablet might be launched into Germany, Austria and Switzerland, China, and India at the same time. In the Sprinkler strategy, the product is launched into all suitable countries at the same time. In the Waterfall strategy, a product is launched in one country at a time, and new markets are entered only after sales are established in the previous market.